"China will announce another 17 percent rise in defense spending this week, completing a one-third increase in acknowledged
military expenditures over the last two years, Chinese and other Asian sources said today. The increase reflects Beijing's
ambition to build a powerful military to complement its robust economy and underpin its strategic position in Asia. But despite
more than a decade of big jumps in the defense budget, Asian and Western military officers and Chinese sources said the
2.5-million-member People's Liberation Army, the largest standing fighting force in the world, is struggling with its modernization
program, handicapped by low pay, poor morale and difficulty absorbing new weapons. Finance Minister Xiang Huaicheng will
announce an increase of around 17.6
percent in defense spending when he details China's budget on Wednesday during a meeting of the legislature, Chinese sources,
Asian diplomats and Chinese-language media reports said. China increased defense spending by 17.7 percent last year; the jump
this year will bring its publicly
acknowledged defense budget to $20 billion. China's real defense spending, including funds expended but not reported, is
considered the highest in Asia, considerably more than the $45 billion spent
annually by Japan. By comparison, the Bush administration has proposed a $379 billion defense budget for the next fiscal year.

Beijing explained its increase last year as a response to "drastic changes" in the military situation around the world, a reference
to the U.S.-led war in Kosovo in 1999. This year, sources said, Beijing needs more money to bolster its nuclear forces following
the Bush administration's decision to
withdraw from the Anti-Ballistic Missile Treaty and continue work on a missile defense system.
China has often voiced concern that, if the United States builds a missile shield, the Chinese nuclear force would lose its strategic
deterrent without more and better warheads and delivery vehicles. China's main modernization efforts, however, focus on turning
the People's Liberation Army from an army of farmers into a modern, streamlined fighting force and to abandon the People's War
doctrine, which involves basic guerrilla tactics, in favor of more traditional doctrines used by world powers.
The goal, according to Pentagon reports, is to become a "regional hegemon," project Chinese power into any corner of Asia,
protect sea lanes for Chinese oil, replace the United States as the preeminent power in the region and use Chinese power to
guarantee reunification with Taiwan".

My comment: It all adds up to an arms buildup, possibly an arms race. The Reagan administration made the dubious claim that
by outspending the USSR on defense it had brought about the collapse of communism. The aim of the US is to become a world
hegemon, and it may well be a good thing for the world. We will see.